Travel prices will creep higher in 2003. That's the word from the American Express crystal ball. In late October, the mega travel company issued its “Trends and Forecasts for the Business Travel Industry Preview 2003,” with the overall prediction of a 2 percent to 3 percent rise in travel expenses next year.
The good news is in the hotel sector, where the forecast is for room costs to remain flat or fall slightly in 2003. Amex explains the steady hotel pricing as a result of relatively low demand combine with oversupply of rooms.
Other costs in the business travel arena, in particular airfares and car rentals — will not be so sluggish. Prices for business airfares in North America are predicted to rise by 3 percent to 4 percent in 2003, after holding steady in 2002, for the most part, when compared to 2001. Typical business airfares, according to the study, are generally the lowest fully refundable economy fares, with up to three days advance purchase. The study predicts that new airline rules governing nonrefundable tickets may increase air costs next year.
International airfares are also on their way up, with Amex forecasting price increases of about 4 percent to 5 percent.
In the car rental arena, rates are predicted to hold flat, but increases in taxes and surcharges will drive overall costs up for 2003.
▲ Domestic Airfares +3% - 4%
▲ International Airfares +4% - 5%
▼ Domestic Hotel Rates -O% - 1%
▲ Car Rental Rates +2% - 3%
SOURCE: American Express Trends and Forecasts for the Business Travel Industry Preview 2003
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